The price of Ethereum has fallen by 5% since Tuesday, September 19, 2023, approaching its lowest point since September 11. Since April 16, Ethereum has been in a mild downtrend characterized by volatile price movements, with a maximum decrease of 28% measured from its April high of $2,134 to its low of $1,536 on September 11.
Despite the recent decline, the overall market structure appears to be corrective. This suggests there’s still potential for the start of an upward movement. Currently, a crucial support level is holding firm, but a retest is imminent, which will determine whether buyers remain active at these levels.
As evident from the 4-hour chart below, Ethereum’s price entered a downtrend on July 14 as it attempted to retest the $2,000 horizontal resistance level. Following the rejection, it initially moved with limited downward momentum but then experienced a significant drop, plummeting from $1,840 on August 15 to $1,545 on August 17.
On August 17, Ethereum experienced its first dip below the $1,600 mark, swiftly rebounding above it. Subsequent price action aimed to consolidate and initiate an upward trend but was thwarted by robust descending resistance.
The downturn on September 19 can be attributed to yet another interaction with the descending trendline. As the price approaches its support zone below $1,600, this marks a crucial retest.
If the support holds, a potential bounce may provide the necessary momentum for an upward breakout. The structure since its April 16 peak appears choppy and indicative of a corrective phase, suggesting the possibility of another ascending move after completion.
However, a sharp drop below $1,600 would invalidate this scenario. The next notable support level lies at $1,480, roughly 7% below the current level. A rebound above $1,540 following a dip to this level might signify a liquidity-seeking move before an upward push.
Alternatively, breaching the $1,480 area would cast doubt on the prospect of an imminent upward move.
Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.